In today’s data rich world, the concept of data integrity is becoming a major discussion point for companies of all sizes. Most discussions center around the need for quality market and financial data to make sound business decisions. It’s hard to argue with this logic. Increasingly however, smart companies are realizing there are two additional aspects of the data integrity discussion that must be looked at in parallel: employee error and employee fraud.
Employee error and fraud represent a global $400 billion + problem that is growing at a rapid rate for businesses of all sizes. It doesn’t matter if you are a $2 million company or a $1 billion company, your risk is real, and it is highly likely that one or both issues are happening in your business today.
- Incorrect invoice amounts
- Duplicate payments
- Duplicate vendors
- Payments made to incorrect vendors
- Incomplete vendor data
- Employees who have left the company but are still on the payroll
These errors happen in every company, result in significant losses, and very few companies have processes in place to proactively look for, and mitigate the issues.
From a fraud standpoint, global research by the Association of Certified Fraud Examiners claims that the average company loses 5% of annual revenues to fraud. This includes payroll fraud, payables fraud, and receivables fraud to name a few. This is a huge number and supporting news stories throughout the media are further proof that the problem is real.
If you are still asking yourself the question, ‘Why should I care?’, it is important to realize that in the coming years these problems are only going to escalate. Reasons include:
- Volume of data. The volume of data that companies need to manage will grow exponentially in the coming years.
- The general population has stretched finances and carries too much debt (this will only intensify) leaving employees not focused/prone to errors due to personal stresses, or worse, more prone to commit fraud.
- System upgrades impacting data quality.
- Complacency, “It won’t happen to me”.
- Lack of checks and balances.
- Companies running lean. All companies are trying to do more with less to increase margins, leaving individual employees focused on too many things and more prone to errors.
- Existing and increasing data integrity issues make it easier for would be fraudsters.
- Most companies still deal with these issues reactively on a case by case basis.
Most companies are naive when it comes to these issues for two reasons:
- They don’t understand the risks
- They have no easy way of analyzing their data to look for and correct the issues before they become a problem
- Proactive detection of costly data entry errors or activity which indicates occupational fraud in financial records before they become big costly issues.
- Provision of an auditable, measurable due diligence platform to improve the quality of data entry.
- Better insights on existing data, operating patterns (e.g. frequent invoicing from key suppliers) and assurance that data is accurate.
- Easy to use and very cost effective.
We are the leader in the employee fraud and error detection space and can have your company up and running on our system, regardless of your accounting or ERP system, in as little as 1 day. Our insightful reporting will provide you with:
- Enhanced insights on existing data
- Improved long-term data integrity
- Process improvement opportunities
- Cost savings
You will be surprised how cost efficient it is to improve your data integrity, save money, and decrease your risks.